Business leaders can teach politicians plenty about the death of command and control.
AUSTRALIA'S best business leaders can teach our politicians a thing or two about how to handle Australia's precarious hung parliament - and how to break through the impasse to lead through collaboration and a new model of leadership.
For years formal boundaries of organisations have become more blurred as traditional hierarchies are replaced with a more complex, interconnected organisational structure. To lead in this environment, command-and-control-style leadership is being rejected for a more participative, collaborative approach and informal authority is becoming more powerful than formal leadership.
This new approach would appear to be what the public voted for in the federal election. Instead of the traditional two-party rigid approach, they want a more collaborative way that meets their more multifaceted values and needs. Certainly the independent MPs holding the balance of power are forcing a new way of thinking and behaving from our politicians.
The key issue comes down to this: Are our politicians (and their powerbrokers) ready for this new leadership challenge? They can look towards the best business leaders for inspiration.
Business leaders have been forced to change their leadership styles for a range of reasons:
■ Technology is removing traditional boundaries and borders within business organisations in the way employees operate and interact with their customers and each other.
■ Generation X and Y workers are rejecting formal and traditional hierarchies and are demanding more flexible and interactive working environments.
■ More demanding consumer and customer relationships are requiring organisations to respond differently to market demands. That's requiring businesses to get closer to their consumer base - meaning they cannot always rely on a top-down approach.
In the past few years, Hay Group has been working with many organisations meeting these challenges from their customers by restructuring and finding new ways of doing business. It has meant more partnerships, more joint ventures and more collaborative arrangements have evolved. These ways of doing business have become critical for organisations to deliver their broader strategies. In some cases the evolution has been extreme, with virtual organisations being created around a common purpose or project.
One common example is the way engineering and construction companies, often in competition with one another, collaborate to deliver large infrastructure projects. There are manufacturing organisations that are both suppliers to and competitors with others in their industry. Pharmaceutical companies are working in collaborative joint ventures in one therapeutic area while competing in others. The reality is that it is becoming more common to see businesses that compete and collaborate with each other - whether it be as customers, suppliers, manufacturers or rivals.
Business used to be so protective of its intellectual property; now many leaders feel it is less about inputs and closely guarded knowledge and more about application and achieving the results. It is by sharing knowledge and information (e.g. many online businesses) that new outcomes are achieved.
Similarly, political parties will need to think more about what outcomes they are delivering to their constituents, rather than inflexibly following the same path - and losing outcomes focus in their obsession with following due process.
Most importantly, values and guiding principles are becoming far more important than formal procedures. The best young talent coming out of universities want to work for the companies with the best values and culture.
What business leaders can teach our politicians is they need a new operating model rather than a traditional party with solid impenetrable boundaries; they need a new team structure to accommodate the need for flexibility, rather than a traditional hierarchy.
That means when doing deals with independent MPs, you need to focus more on the accountabilities of individuals and teams to deliver on promises. You can no longer have the luxury of falling back on party unity if you have to make a political backflip.
Our new political leaders may also need to more consistently demonstrate a new behavioural style; they still need to deliver on the results, so drive, focus and direction-setting are essential, but they also need to be more inclusive, participative and collaborative.
Collaboration and participation do not reduce accountability; the opposite will be true in the new Parliament, as there will be a high expectation to deliver on promises in a more complex environment.
What the best business leaders would tell politicians is competitive agendas will destroy their ability to deliver outcomes to key stakeholders. Collaboration requires having basic trust and shared values, even if this is tough.
This will be the only way one of our major political parties will strike a lasting agreement with the independent MPs. One thing is for certain in the new Parliament: command-and-control styles of leadership are out. Business already knows this. What the political leaders of the future are developing - as are the best business and organisational leaders - is the art of aligning different groups with a shared direction and clearly communicating this vision to generate energy for outcomes and real change.
Politicians must be able to use informal influence by working with individuals and teams to gain traction within collaborative groups to achieve their desired outcomes.
Business leaders have been forced to juggle these new demands throughout the global financial crisis, even in face of enormous organisational complexity, matrix structures and increasingly demanding stakeholders - most particularly, restless shareholders. Now is the time for politicians to demonstrate this new collaborative form of leadership. They need to take a leaf out of the book of our most effective contemporary business and organisational leaders - or risk missing the chance to form government.
Henriette Rothschild is Pacific general manager of Hay Group.
